Category Archives: BT Health

Dare anyone criticise this IT project – with the CEO as leader?

Posted on 03/02/2014 | Leave a comment

By Tony Collins

Croydon Health Services NHS Trust has had mixed success with its go-live of the Cerner Millennium system.

It is said to be a technical success but last week board members of the Croydon Clinical Commissioning Group expressed concerns about ongoing problems with the system.

Fouzia Harrington, director of quality and governance told the Croydon Advertiser: “The implementation [of Cerner] itself went well in technical terms, but there have been some implications about how it has been used by staff.

“It’s had far more impact in terms of the time it takes to book people in, for example. There have also been implications in terms of lost information about patients.

“There has been a lack of information about hospital activity, which has an impact on finances and, potentially,the quality of services patients are receiving…”

David Hughes, a lay member of the board, was not satisfied with that reassurance.

“You say that no harm has occurred,” he said,  “but while we’ve had no direct incident so far, patient care has definitely suffered.

“You talk about increased waiting times and there’s a risk that harm may occur because of the difficulty in getting in touch with clinicians who actually know what is going on with the patient.

“I’m very concerned from a quality point of view that our main provider has a serious problem with its information systems.”

Hughes called for action. Although the trust may not be aware of an incident yet it may “come out through further investigation that there has been”.

Some waiting times have increased,  the CCG cannot be certain of exact levels of activity at the hospital, and missing information has made it difficult to commission some services.

The concerns were raised at a board meeting on Tuesday.

Dr Tony Brzezicki, chairman of the CCG, said new system would eventually lead to improvements.  “Hospital patients had five sets of notes before. That in itself posed a risk that Cerner will mitigate,” he said.

“However, there have been administrative delays which mean longer waiting times for patients.There are also issues for the service to primary care which is a significant risk. Some of the problems have been resolved though I am concerned at the time scale because they are certainly impacting on my practice.”

Success

John Goulston is the Croydon Health Services NHS Trust CEO. One of his previous jobs was as Programme Director of the London Programme for IT at NHS London. The LPfIT was formerly part of the National Programme for IT. 

As well as CEO, he chairs the trust’s Informatics Programme Board which has taken charge of bringing Cerner Millennium to Croydon’s community health services and the local University Hospital, formerly the Mayday.

Goulston reported to his board that the Cerner go-live – on 30 September and 1 October last year – was a success.

“Our partners Cerner, BT and Ideal have commented that the Trust has undertaken one of the most efficient roll-outs of the system they have worked on, with more users adopting the system more quickly and efficiently than other trusts … the success we have achieved to date is the result of the efforts of every single system user and all staff members,” said Goulston.

Goulston has said the trust deployed the “largest number of clinical applications in a single implementation in the NHS”. 

The Department of Health provided central funding, and the trust paid for implementation “overheads”.  The Health and Social Care Information Centre was the trust’s partner for the go-live.

The Croydon Advertiser asked Croydon Health Servicesa series of questions about Cerner, including its cost to the NHS, but was sent a short statement.

A spokesman told the Advertiser the system would improve patient administration and means that nurses have access to “quality, detailed information” when delivering care.

He added: “During the initial switch over of systems in September while staff were getting used to the system, some patients did need to wait slightly longer to check in for their clinic appointments.

“The trust has maintained and surpassed our 18 week referral to treatment targets from the initial roll out.”

Croydon’s response

Campaign4Change put some questions to the Croydon trust. These are the questions and its responses: .

Is the trust being completely open – taking seriously the duty of candour –  about problems arising from the Cerner Millennium go-live?

“The Trust takes its duty of candour on all issues very seriously; we believe that transparency is essential in running a modern NHS organisation. We are held to account by our board at public meetings, where the public are able to attend and question our senior management team, by our local health overview and scrutiny committee and our commissioners.

“Recent press coverage on CRS Millennium appeared in the local press when the system was discussed in a public meeting of our commissioners.”

As the CEO is leading the Cerner Millennium project, does this make it difficult for trust staff and trust directors to say anything even mildly critical about the implementation?

“Staff opinions on the implementation of CRS Millennium, both positive and negative, are welcomed by the Trust. Staff have given their frank opinions of the system directly to the Chief Executive both in our monthly all staff meetings and at the open staff engagement surgeries held by our Chief Executive and Chairman. All staff opinions are taken seriously and are acted upon appropriately.”

Given the CEO’s enthusiasm for the implementation is there a special onus on the press office to defend the implementation and play down problems? [I note that the Croydon Advertiser implied its questions had not been answered, and that the Trust gave a short statement instead.]

“The communications team respond to and facilitate a large number of external requests, including from the media, in a transparent, timely and appropriate manner. This same approach is followed on questions about CRS Millennium.

“CRS Millennium will bring about many improvements to patient care and Trust efficiency and we are enthusiastic about communicating these; it is unfortunate that recent press coverage did not consider these positive benefits in any depth.”

A comment on the Croydon Advertiser’s website says:

“When I checked in to out-patients I supplied all my personal details; however the post code I gave was declared invalid by the new system. That filled me with confidence. I also gave my contact as a mobile; however they tried to ring me using an old landline number.”

Comment

It’s generally accepted that having a high-level sponsor for an IT project is essential but when the lead is the CEO, does that make it difficult for people to challenge and constructively criticise?

A “good news” culture tends to prevail – as happened on Universal Credit, on the BBC’s Digital Media Initiative, and within the Department of Health on the NPfIT. Nobody dared to speak the whole truth to power. The truth tends to surface only when a new administration takes over or, in the case of Universal Credit, the minister obtained his own independent reports on project progress.

Campaign4Change put it to the Croydon trust that board directors see reports on the Cerner implementation only every two months and much can happen in the intervening period. This it did not deny.

Even if the trust’s directors met daily would they dare to challenge the CEO? And will the full facts  ever emerge? Things could be much better than CCG directors believe  – or much worse.

After nearly every major NPfIT implementation of the Cerner Millennium system in London and beyond (such as North Bristol) the facts were scarce, and reassurances that no patients had come to harm were plentiful. 

Here we go again?

**

Should lessons have been learned from these Cerner go-lives?

Barts and The London

Royal Free Hampstead

Weston Area Health Trust

Milton Keynes Hospital NHS Trust

Worthing and Southlands

Barnet and Chase Farm Hospitals NHS Trust

Nuffield Orthopaedic

North Bristol.

St George’s Healthcare NHS Trust

University Hospitals of Morecambe Bay NHS Foundation Trust

Birmingham Women’s Foundation Trust

NHS Bury

GPs asked to contact hundreds of patients who may have missed treatment after hospital’s cancer referrals blunder  – Pulse

London LMCs alert over Imperial cancer waits mix-up – Pulse.

GPs kept in the dark over hospital cancer blunder – Pulse

 IT system has increased waiting times and led to lost patient data.

Patient records go-live success – or NPfIT failure

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Posted in BT, BT Health, Campaign4Change, Department of Health, e-health, excessive secrecy, health, health records, LPfIT, NHS, npfit, openness and transparency, operational issues

MP calls for candour after Cerner NPfIT go-live at Croydon

Posted on 10/12/2013 | 1 comment

By Tony Collins

Richard Bacon, a long-standing member of the House of Commons’ Public Accounts Committee, has called on Croydon Health Services NHS Trust to be more open about problems it faces after deploying a Cerner Millennium patient records system at the end of September.

The installation was carried out by BT under the London Programme for IT – a branch of the NPfIT.  The Health and Social Care Information Centre, which has taken on BT and CSC contracts under the NPfIT, was the trust’s partner for the Cerner deployment.

Bacon has closely followed the NPfIT and written a chapter on it in his book, “Conundrum: Why every government gets things wrong and what we can do about it” which he co-wrote with Christopher Hope, the Telegraph’s senior political correspondent.

According to fragments of information in Croydon Health Services’ latest board papers, dated 25 November 2013, the trust has faced a series of problems after the NPfIT Cerner go-live.

They included:

–  N3 Network downtime and waiting time breaches.

– Excessive waits for patients in A&E. 

– Going over budget.

– Significant loss of income.

– A bid to recover Cerner costs.

– A need for HSCIC support for delays. 

-A need for extra investment in Cerner to “stabilise the operational position”

The trust has not published any specific report on the implementation’s problems. Now Bacon says it is “unacceptable for any trust not to disclose the problems it faces – and possibly patients face – after a major IT implementation such as Cerner”.

He adds:

“If these implementations go wrong they can affect the safety of patients.  We know this from some NPfIT deployments at other  trusts. For Croydon to say that board members have been kept informed of the potential risks of the Cerner implementation through the “Corporate Risk and Board Assurance Framework”  is not reassuring.

“This is putting a matter of importance in the small print. Indeed, for officials to brief board members on the potential risks, rather than actual events, is also of concern.

“Patients need to know that Croydon takes a duty of candour seriously. If the Trust cannot be open about its IT-related problems, how can we be sure it will be open about anything else to do with patient safety?”

Patient records go-live “success” – or a new NPfIT failure 

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Posted in BT, BT Health, Campaign4Change, CSC, e-health, excessive secrecy, health, health records, IT-related failures, LPfIT, NHS, npfit

Trust spends £16.6m on consultants for Cerner EPR

Posted on 01/08/2013 | 2 comments

By Tony Collins

Reading-based Royal Berkshire NHS Foundation Trust says in an FOI response that its spending on “computer consultants since the inception of the EPR system is £16.6m”.

The Trust’s total spend on the Cerner Millennium system was said to have been £30m by October 2012.

NHS IT suppliers have told me that the typical cost of a Trust-wide EPR [electronic patient record] system, including support for five years, is about £6m-£8m, which suggests that the Royal Berkshire has spent £22m more than necessary on new patient record IT.

Jonathan Isaby, Taxpayers’ Alliance political director, said: “This is an astonishing amount of taxpayers’ money to have squandered on a system which is evidently failing to deliver results.

“Every pound lost to this project is a pound less available for frontline medical care. Those who were responsible for the failure must be held to account for their actions as this kind of waste cannot go unchecked.”

 The £16.6m consultancy figure was uncovered this week through a Freedom of Information request made by The Reading Chronicle. It had asked for the spend on consultants working on the Cerner Millennium EPR [which went live later than expected in June 2012].

The Trust replied: “Further to your request for information the costs spent on computer consultants since the inception of the EPR system is £16.6m.”

The Chronicle says that the system is “meant to retrieve patient details in seconds, linking them to the availability of surgeons, beds or therapies, but has forced staff to spend up to 15 minutes navigating through multiple screens to book one routine appointment, leading to backlogs on wards and outpatient clinics”.

Royal Berkshire’s chief executive Edward Donald had said the Cerner Millennium go live was successful.  A trust board paper said:

 “The Chief Executive emphasised that, despite these challenges, the ‘go-live’ at the Trust had been more successful than in other Cerner Millennium sites.”

A similar, stronger message had appeared was in a separate board paper which was released under FOI.  Royal Berkshire’s EPR [electronic patient record] Executive Governance Committee minutes said:

“… the Committee noted that the Trust’s launch had been considered to be the best implementation of Cerner Millennium yet and that despite staff misgivings, the project was progressing well. This positive message should also be disseminated…”

Comment

Royal Berkshire went outside the NPfIT. But its costs are even higher than the breathtakingly high costs to the taxpayer of NPfIT Cerner and Lorenzo implementations.

As senior officials at the Department of Health have been so careless with public funds over NHS IT – and have spent millions on the same sets of consultants – they are in no position to admonish Royal Berkshire.

So who can criticise Royal Berkshire and should its chief executive be held accountable?

When it’s official policy to spend tens of millions on EPRs that may or may not make things better for hospitals and patients – and could make things much worse – how can accountability play any part in the purchase of the systems and consultants?

The enormously costly Cerner and Lorenzo EPR implementations go on – in an NHS IT world that is largely without credible supervision, control, accountability or regulation.

Cash squandered on IT help

Trust loses £18m on IT system

The best implementation of Cerner Millennium yet?

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Posted in BT Health, Cerner, consultants, CSC, culture, e-health, Freedom of Information, health records, IT-related failures, NHS, npfit, oversight, Politics, procurement, public sector, public services, software quality, supplier relationships

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Firecontrol disaster and NPfIT – two of a kind?

Posted on 23/07/2013 | 5 comments

By Tony Collins

Today’s report of the Public Account Committee on the Firecontrol project could, in many ways, be a report on the consequences of the failure of the National Programme for IT in the NHS in a few years time.

The Firecontrol project was built along similar lines to the NPfIT but on a smaller scale.

With Firecontrol, Whitehall officials wanted to persuade England’s semi-autonomous 46 local fire authorities to take a centrally-bought  IT system while simplifying and unifying their local working practices to adapt to the new technology.

NPfIT followed the same principle on a bigger scale: Whitehall officials wanted to persuade thousands of semi-autonomous NHS organisations to adopt centrally-bought technologies. But persuasion didn’t work, in either the fire services or the NHS.

More similarities

The Department for Communities and Local Government told
the PAC that the Firecontrol control was “over-specified” – that it was unnecessary to have back-up to an incident from a fire authority from the other side of the country.

Many in the NHS said that NPfIT was over-specified. The gold-plated trimmings, and elaborate attempts at standardisation,  made the patient record systems unnecessarily complicated and costly – and too difficult to deliver in practice.

As with the NPfIT, the Firecontrol system was delayed and local staff  had little or no confidence it would ever work, just as the NHS had little or no faith that NPfIT systems would ever work.

Both projects failed. Firecontrol wasted at least £482m. The Department of Communities and Local Government cancelled it in 2010. The Department of Health announced in 2011 that the NPfIT was being dismantled but the contracts with CSC and BT could not be cancelled and the programme is dragging on.

Now the NHS is buying its own local systems that may or may not be interoperable. [Particularly for the long-term sick, especially those who have to go to different specialist centres, it’s important that full and up-to-date medical records go wherever the patients are treated and don’t at the moment, which increases the risks of mistakes.]

Today’s Firecontrol report expresses concern about a new – local – approach to fire services IT. Will the local fire authorities now end up with a multitude of risky local systems, some of which don’t work properly, and are all incompatible, in other words don’t talk to each other?

This may be exactly the concern of a post-2015 government about NHS IT. With the NPfIT slowly dying NHS trusts are buying their own systems. The coalition wants them to interoperate, but will they?  

Could a post-2015 government introduce a new (and probably disastrous) national NHS IT project – son of NPfIT – and justify it by drawing attention to how very different it is to the original NPfIT eg that this time the programme has the buy-in of clinicians?

The warning signs are there, in the PAC’s report on Firecontrol. The report says there are delays on some local IT projects being implemented in fire authorities, and the systems may not be interoperable. The PAC has 

” serious concerns that there are insufficient skills across all fire authorities to ensure that 22 separate local projects can be procured and delivered efficiently in so far as they involve new IT systems”.

National to local – but one extreme to the other?

The PAC report continues

“There are risks to value for money from multiple local projects. Each of the 22 local projects is now procuring the services and systems they need separately.

“Local teams need to have the right skills to get good deals from suppliers and to monitor contracts effectively. We were sceptical that all the teams had the appropriate procurement and IT skills to secure good value for money.

“National support and coordination can help ensure systems are compatible and fire and rescue authorities learn from each other, but the Department has largely devolved these roles to the individual fire and rescue authorities.

“There is a risk that the Department has swung from an overly prescriptive national approach to one that provides insufficient national oversight and coordination and fails to meet national needs or achieve economies of scale. 

Comment

PAC reports are meant to be critical but perhaps the report on Firecontrol could have been a little more positive about the new local approach that has the overwhelming support of the individual fire and rescue authorities.  

Indeed the PAC quotes fire service officials as saying that the local approach is “producing more capability than was expected from the original FiReControl project”. And at a fraction of the cost of Firecontrol.

But the PAC’s Firecontrol Update Report expresses concern that

– projected savings from the local approach are now less than originally predicted

– seven of the 22 projects are running late and two of these projects have slipped by 12 months

– “We have repeatedly seen failures in project management and are concerned that the skills needed for IT procurement may not be present within the individual fire and rescue authorities, some of which have small management teams,” says the PAC.

On the other hand …

The shortfall in projected savings is small – £124m against £126m and all the local programmes are expected to be delivered by March 2015, only three months later than originally planned.

And, as the PAC says, the Department for Communities and Local Government has told MPs that a central peer review team is in place to help share good practice – mainly made up of members of fire and rescue authorities themselves.

In addition, part of the £82m of grant funding to local fire services has been used by some authorities to buy in procurement expertise.

Whether it is absolutely necessary – and worth the expense – for IT in fire services to link up is open to question, perhaps only necessary in a national emergency.

In the NHS it is absolutely necessary for the medical records of the chronically sick to link up – but that does not justify a son-of-NPfIT programme. Linking can be done cheaply by using existing records and having, say, regional servers pull together records from individual hospitals and other sites.

Perhaps the key lesson from the Firecontrol and the NPfIT projects is that large private companies can force their staff to use unified IT systems whereas Whitehall cannot force semi-autonomous public sector organisations to use whatever IT is bought centrally.

It’s right that the fire services are buying local IT and it’s right that the NHS is now too. If the will is there to do it cheaply, linking up the IT in the NHS can be done without huge central administrative edifices.

Lessons from FireControl (and NPfIT?) 

The National Audit Office identifies these main lessons from the failure of Firecontrol:

– Imposing a single national approach on locally accountable fire and rescue authorities that were reluctant to change how they operated

–  Launching the programme too quickly without applying basic project approval checks and balances

– Over optimism on the deliverability of the IT solution.

– Issues with project management including consultants who made up half of the management team and were not effectively managed

MP Margaret Hodge, chair of the Public Accounts Committee, today sums up the state of Firecontrol

“The original FiReControl project was one of the worst cases of project failure we have seen and wasted at least £482 million of taxpayers’ money.

“Three years after the project was cancelled, the DCLG still hasn’t decided what it is going to do with many of the specially designed, high-specification facilities and buildings which had been built. Four of the nine regional control centres are still empty and look likely to remain so.

“The Department has now provided fire and rescue authorities with an additional £82 million to implement a new approach based on 22 separate and locally-led projects.

“The new programme has already slipped by three months and projected savings are now less than originally predicted. Seven of the 22 projects are reportedly running late and two have been delayed by 12 months. We are therefore sceptical that projected savings, benefits and timescales will be achieved.

“Relying on multiple local projects risks value for money. We are not confident that local teams have the right IT and procurement skills to get good deals from suppliers and to monitor contracts effectively.

“There is a risk that the DCLG has swung from an overly prescriptive national approach to one that does not provide enough national oversight and coordination and fails to meet national needs or achieve economies of scale.

 “We want the Department to explain to us how individual fire and rescue authorities with varied degrees of local engagement and collaboration can provide the needed level of interoperability and resilience.

“Devolving decision-making and delivery to local bodies does not remove the duty on the Department to account for value for money. It needs to ensure that national objectives, such as the collaboration needed between fire authorities to deal with national disasters and challenges, are achieved.”

Why weren’t NPfIT projects cancelled?

 NPfIT contracts included commitments that the Department of Health and the NHS allegedly did not keep, which weakened their legal position; and some DH officials did not really want to cancel the NPfIT contracts (indeed senior officials at NHS England seem to be trying to keep NPfIT projects alive through the Health and Social Care Information Centre which is responsible for the local service provider contracts with BT and CSC).

PAC report on Firecontrol

What Firecontrol and the NPfIT have in common (2011)

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Posted in BT, BT Health, Campaign4Change, change management, consultants, CSC, data sharing, e-health, efficiency savings, Firecontrol, Government IT, health records, IT-related failures, managing outsourced services, NHS, outsourcing, project management, public sector, public services, shared services, Summary Care Record, supplier relationships

How to cost-justify the NPfIT disaster – forecast benefits a decade away

Posted on 07/06/2013 | 2 comments

By Tony Collins

To Jeremy Hunt, the Health Secretary, the NPfIT was a failure. In an interview with the FT, reported on 2 June 2013, Hunt said of the NPfIT

“It was a huge disaster . . . It was a project that was so huge in its conception but it got more and more specified and over-specified and in the end became impossible to deliver … But we musn’t let that blind us to the opportunities of technology and I think one of my jobs as health secretary is to say, look, we must learn from that and move on but we must not be scared of technology as a result.”

Now Hunt has a different approach.  “I’m not signing any big contracts from behind [my] desk; I am encouraging hospitals and clinical commissioning groups and GP practices to make their own investments in technology at the grassroots level.”

Hunt’s indictment of the NPfIT has never been accepted by some senior officials at the DH, particularly the outgoing chief executive of the NHS Sir David Nicholson. Indeed the DH is now making strenuous attempts to cost justify the NPfIT, in part by forecasting benefits for aspects of the programme to 2024.

The DH has not published its statement which attempts to cost justify the NPfIT. But the National Audit Office yesterday published its analysis of the unpublished DH statement. The NAO’s analysis “Review of the final benefits statement for programmes previously managed under the National Programme for IT in the NHS” is written for the Public Accounts Committee which meets next week to question officials on the NPfIT. 

A 22 year programme?

When Tony Blair gave the NPfIT a provisional go-ahead at a meeting in Downing Street in 2002, the programme was due to last less than three years. It was due to finish by the time of the general election of 2005. Now the NPfIT  turns out to be a programme lasting up to 22 years.

Yesterday’s NAO report says the end-of-life of the North, Midlands and East of England part of the NPfIT is 2024. Says the NAO

“There is, however, very considerable uncertainty around whether the forecast benefits will be realised, not least because the end-of-life dates for the various systems extend many years into the future, to 2024 in the case of the North, Midlands and East Programme for IT.”

The DH puts the benefits of the NPfIT at £3.7bn to March 2012 – against costs of £7.3bn to March 2012.

Never mind: the DH has estimated the forecast benefits to the end-of-life of the systems at £10.7bn. This is against forecast costs of £9.8bn to the end-of-life of the systems.

The forecast end-of-life dates are between 2016 and 2024. The estimated costs of the NPfIT do not include any settlement with Fujitsu over its £700m claim against NHS Connecting for Health. The forecast costs (and potential benefits) also exclude the patient administration system Lorenzo because of uncertainties over the CSC contract.

The NAO’s auditors raise their eyebrows at forecasting of benefits so far into the future. Says the NAO report

“It is clear there is very considerable uncertainty around the benefits figures reported in the benefits statement. This arises largely because most of the benefits relate to future periods and have not yet been realised. Overall £7bn (65 per cent) of the total estimated benefits are forecast to arise after March 2012, and the proportion varies considerably across the individual programmes depending on their maturity.

“For three programmes, nearly all (98 per cent) of the total estimated benefits were still to be realised at March 2012, and for a fourth programme 86 per cent of benefits remained to be realised.

There are considerable potential risks to the realisation of future benefits, for example systems may not be deployed as planned, meaning that benefits may be realised later than expected or may not be realised at all…”

NPfIT is not dead

The report also reveals that the DH considers the NPfIT to be far from dead. Says the NAO

“From April 2013, the Department [of Health] appointed a full-time senior responsible owner accountable for the delivery of the [the NPfIT] local service provider contracts for care records systems in London, the South and the North, Midlands and East, and for planning and managing the major change programme that will result from these contracts ending.

“The senior responsible owner is supported by a local service provider programme director in the Health and Social Care Information Centre.

“In addition, from April 2013, chief executives of NHS trusts and NHS foundation trusts became responsible for the realisation and reporting of benefits on the ground. They will also be responsible for developing local business cases for the procurement of replacement systems ready for when the local service provider contracts end.”

The NAO has allowed the DH to include as a benefit of the NPfIT parts of the programme that were not included in the original programme such as PACS x-ray systems.

Officials have also assumed as a benefit quicker diagnosis from the Summary Care Record and text reminders using NHSmail which the DH says reduces the number of people who did not attend their appointment by between 30 and 50 per cent.

Comment

One of the most remarkable things about the NPfIT is the way benefits have always been – and still are – referred to in the future tense. Since the NPfIT was announced in 2002, numerous ministerial statements, DH press releases and conference announcements have all referred to what will happen with the NPfIT.

Back in June 2002, the document that launched the NPfIT, Delivering 21st Century IT for the NHS, said:

“We will quickly develop the infrastructure …”

“In 2002/03 we will seek to accelerate the pace of development …

“Phase 1 – April 2003 to December 2005 …Full National Health Record Service implemented, and accessible nationally for out of hours reference.”

In terms of the language used little has changed. Yesterday’s NAO report is evidence that the DH is still saying that the bulk of the benefits will come in future.

Next week (12 June) NHS chief Sir David Nicholson is due to appear before the Public Accounts Committee to answer questions on the NPfIT. One thing is not in doubt: he will not concede that the programme has been a failure.

Neither will he concede that a fraction of the £7.3bn spent on the programme up to March 2012 would have been needed to join up existing health records for the untold benefit of patients, especially those with complex and long-term conditions.

Isn’t it time MPs called the DH to account for living in cloud cuckoo land? Perhaps those at the DH who are still predicting the benefits of the NPfIT into the distant future should be named.

They might just as well have predicted, with no less credibility, that in 2022 the bulk of the NPfIT’s benefits would be delivered by the Flower Fairies.

It is a nonsense that the DH is permitted to waste time on this latest cost justification of the NPfIT. Indeed it is a continued waste of money for chief executives of NHS trusts and NHS foundation trusts to have been made responsible, as of April 2013, for reporting the benefits of the NPfIT.

Jeremy Hunt sums up the NPfIT when he says it has been a huge disaster. It is the UK’s biggest-ever IT disaster. Why does officialdom not accept this?

Instead of wasting more money on delving into the haystack for benefits of the NPfIT, it would be more sensible to allocate money and people to spreading the word within Whitehall and to the wider public sector on the losses of the NPfIT and the lessons that must be learnt to discourage any future administrations from embarking on a multi-billion pound folly.

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Posted in Atos, BT, BT Health, Campaign4Change, change, change management, CSC, e-health, excessive secrecy, Fujitsu, health records, IT projects, IT-related failures, legal disputes, Major Projects Authority, managing change, managing outsourced services, NHS, npfit, public sector, public services, Summary Care Record

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Don’t fire staff before going live – lessons from a SAP project failure

Posted on 13/02/2013 | Leave a comment

By Tony Collins

When an NHS chief executive spoke at a conference in Birmingham about how he’d ordered staff cuts in various departments in advance of a patient administration system going live – to help pay for the new system – it rang alarm bells.  

This is because more staff are usually needed to cope with extra workloads and unexpected problems during and after go-live. That’s a lesson BT and CSC gradually learned from Cerner and Lorenzo go-lives under the National Programme for IT. It’s also a lesson from some of the case studies in “Crash”.

The trust chief executive who was making the speech was managing his go-live outside of the NPfIT. He didn’t seem to realise that you shouldn’t implement savings in advance of a go-live, that the go-live is likely to cost much more than expected, and that, as a chief executive, he shouldn’t over-market the benefits of the new system internally. Instead he should be honest about life with the new system. Some things will take longer. Some processes will be more laborious.

Bull-headed

If the chief executive is bull-headedly positive and optimistic about the new IT his board directors and other colleagues will be reluctant to challenge him. Why would they tell him the whole story about the new system if he’d think less of them for it? They would pretend to be as optimistic and gung-ho as he was. And then his project could fail.

Much of this I said when I approached the trust chief executive after his speech. It wasn’t any of my business and he’d have been justified in saying so. But he listened and, as far as I know, delayed the go-live and applied the lessons.

Disaster

Now a SAP project disaster in the US has proved a reminder of the need to have many extra people on hand during and after go-live – and that go-live may be costlier and more problem-laden than expected.

The Post-Standard reported last month that a $365m [£233m] system that was intended to replace a range of legacy National Grid’s payroll and finance IT has led to thousands of employees receiving incorrect payments and delayed payments to suppliers. Some employees were not paid at all and the company ended up issuing emergency cheques.

Two unions issued writs on behalf of unpaid workers, and the Massachusetts attorney general fined National Grid $270,000 [£172,500] for failing to comply with wage laws. New York’s attorney general subpoenaed company records to investigate.

Hundreds assigned to cope with go-live aftermath

National Grid spokesman Patrick Stella said the company has assigned hundreds of employees, including outside contractors, to deal with problems spawned by the new system. Many of them have been packed into the company’s offices in Syracuse in the state of New York. Others are dispersed to work at “payroll clinics,” helping employees in crew barns or other remote locations.

For more than a year National Grid worked to develop a new system to consolidate a patchwork of human resource, supply chain and finance programs it inherited from the handful of U.S. utilities it has acquired. The system, based on SAP, cost an estimated $365m, according to National Grid regulatory filings.

Stella said the glitches to be expected when a complex new system goes live were exacerbated in the wake of Sandy, when thousands of employees worked unusual hours at unusual locations. “It would have been challenging without Hurricane Sandy,” Stella said.

SAP software woes continue to plague National Grid.

Payroll blunder.

National Grid struggles to fix payroll problems.

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Posted in BT, BT Health, Campaign4Change, Cerner, CSC, IT projects, IT-related failures, NHS, npfit, SAP

Summary Care Record “unreliable”

Posted on 05/10/2012 | 1 comment

By Tony Collins

The  central Summary Care Record database (which is run by BT under its NPfIT Spine contract) is proving unreliable, Pulse reports today.

The SCR is supposed to give clinicians , particularly those working in A&E and for out-of-hours services, a view of the patient’s most recent medicines, allergies and bad reactions to drugs.

But one criticism of the scheme has always been the lack of any guarantee that the data in the SCR could be accurate or complete.

Researchers at University College, London, led by Trisha Greenhalgh, found in a confidential draft report that doctors were unable to trust the SCR database as a single source of truth. They found in some cases that  some information on the database was wrong, and what should have been included in the patient’s record was omitted for unknown reasons.

Now Pulse reports that some GP-derived information is going on the patient’s SCR, and some isn’t. One problem is that GPs must use smartcards to update the SCR database and some don’t use them.

The General Practitioners Committee of the British Medical Association has raised the matter with the Department of Health.

Dr Paul Roblin, chief executive of Oxfordshire, Buckinghamshire and Berkshire local medical committee told Pulse that  smartcards were not often used in Buckinghamshire, because they slowed down the practice IT system for normal use, with one practice reporting that it had interfered with allergy data.

Dr Roblin said that this made the record ‘unreliable’ and said that although most GPs would prefer to take their own history rather than relying on the SCR, and would double check all details with the patient, other health professionals may not realise the record is incomplete, and may not check the data.

He said “Drugs lists might not be complete and recent allergies may not be uploaded. The Summary Care Record is unreliable. Don’t rely on it. It’s an expensive initiative without a lot of benefit.”

Dr Chaand Nagpaul, GPC lead negotiator on IT, said the current arrangements  undermine the benefit and usefulness of summary care records.

“The GPC have suggested workaround systems for practices who do not use smartcards, such as a ‘mop-up’ session where all new data is uploaded on to the national spine once a day. However, the DH decided against this option.”

There may be professionals who believe the SCR database  represents an up to date record said Nagpaul.

A DH spokesperson said that most practices which have created Summary Care Records use smartcards.

[Whether justified or not the SCR  scheme is believed to have cost about £250m so far.]

In 2010 Professor Ross Anderson at Cambridge University argued that the SCR could do more harm than good.

Richard Veryard also wrote on the unreliability of the SCR in 2010.

The Devil’s in the Detail – UCL report on the Summary Care Record.

Summary Care Record – where does the truth lie?

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A mega-outsourcing plan in Cornwall beset by naive fanaticism?

Posted on 01/10/2012 | 6 comments

By Tony Collins

Comment and analysis

An inner circle of councillors at Cornwall council is rushing plans to sign a big outsourcing deal despite a council vote against it.  The aims of the deal include an IT-based transformation of services,  the creation of “up to” 500 new jobs and tens of millions of pounds in savings – all too good to be true? 

The warning signs are there. The council’s remarkable naivety,  a hurried enthusiasm for signing a deal, and a confident waving aside of internal and external concerns,  may be early indications of a possible disaster.  An internal report warns of a potential “catastrophe” over service delivery.

 If all turns sour could accusations of maladministration follow? Is there still time for the full council to stop the inner circle from pressing ahead with a contract signing?

Major IT suppliers have some exceptional salespeople. They don’t merely sell hardware, software and services. They inspire. They rouse to action. Their promises are believable because they believe them with a conviction that can be contagious.

Joe Galloway might have been a one-off.  He was managing director of a part of one of the world’s largest IT companies EDS (now HP).  He helped to strike a CRM [Customer Relationship Management] deal with BSkyB in 2000. The contract ended in a £709m legal dispute in which Galloway was a main witness for HP. The judge in the case of BSkyB v HP found that some of Galloway’s evidence was untrue.

He demonstrated an “astounding ability to be dishonest, making up a whole story about being in St John [part of the Virgin Islands], working there and studying at Concordia College. EDS properly distance themselves from his evidence and realistically accept that his evidence should be treated with caution,” said the judge.

The judge also said

“I am driven to the conclusion that he proffered timescales (on the CRM project) which he thought were those which Sky desired, without having a reasonable basis for doing so and knowing that to be the position… I consider that he acted deliberately in putting forward the timescales knowing that he had no proper basis for those timescales. At the very least he was reckless, not caring whether what he said was right or wrong.”

During the High Court hearing, when HP discovered Galloway’s dishonesty, it sacked him.

He had held a senior position at EDS and the company’s customer BSkyB believed what he had said.  The case cost HP £318m plus tens of millions of pounds in legal fees – and the dispute lasted more than seven years. HP, it could be said, became a victim of some of the statements made by one of its executives.

The point about mentioning the case is that supplier promises, even if made with the best of intentions, may in the end come to nothing – or worse, a costly and prolonged legal dispute. Good intentions were behind the setting up of a joint venture between IBM and Somerset County Council – Southwest One – in 2007. The two sides are now immersed in a legal dispute that looks like going to court. Other councils have gone into joint ventures with major IT suppliers only to be disappointed.

So why do councils still want to sign mega outsourcing deals?

Councils keen to enter a large outsourcing deal become convinced that failures of such ventures elsewhere do not apply to them because their plans are unique. Indeed Cornwall council says on its website:

“Our strategic partnership is unlike any that has happened before, and as such, we cannot compare our programme accurately to others.”

But how do potential suppliers explain failing contracts?

In talks with potential customers IT companies correct or clarify reports in the media about outsourcing deals that have failed or are failing. It is customary during the bidding process for salespeople to take potential clients to reference sites where the representatives will agree that the media reports of a failing partnership were inaccurate or hyperbolic.

[Councils that have signed failing outsourcing deals will sometimes be reluctant to publicise the fact – and may put on a brave face in which they align themselves with the supplier; until a council changes hands, as at Somerset County Council, when a new administration is happy to publicise the mistakes of the last, and the full extent of the problems begins to emerge publicly.]

Cornwall council says on its website that it has received responses from its two shortlisted suppliers BT and CSC to specific negative press articles. The Council is now untroubled by any of the articles.

Says Cornwall

 “The feedback we received from the references contacted were balanced and gave us no significant causes for concern… We do need to reflect that these are press stories and we know only too well from our own experience that you can find negative reports on most major companies if you look for them.

“As global companies, it is to be expected that you will find a whole range of perspectives on each; it is important we take a balanced and independent view.  Please be assured that we will continue to work with both companies to deal with any issues that may arise throughout the procurement process and beyond…”

Articles BT and CSC were not asked to respond to included one in the Financial Times which said of NHS IT contracts:

“There are big doubts as to whether the government can fire BT and CSC, its two main suppliers, without paying huge sums in compensation.”

Cornwall says it continues to monitor press coverage, with the help of BT and CSC. It suggests that articles not yet written may be biased.

“… We actively monitor the press, and both companies [BT and CSC] make sure that they let us know if a negative or positive story is going to break, making sure that we understand the background. It is important to note that these articles do not always present an unbiased view,” says Cornwall.

Does setting up a “critical friend” group give a false assurance?

On the face of it Cornwall deserves praise for setting up an independent panel of “critical friends” to scrutinise the council’s outsourcing plans. It is called the “Support Services Single Issue Panel” which comprises mostly Cornwall councillors. It had help from, among others, council officers, and BT and CSC. The Panel also visited some customers of BT and CSC that the suppliers chose.

But when the Panel later expressed serious concerns about Cornwall’s outsourcing plans the council’s inner circle simply replied that it did not accept those concerns. This may strike some as a naive response to real risks.

This was part of the council’s response to the Panel:

“We do not accept the magnitude of some of the risks raised in the SIP [Single Issue Panel]. This includes the risk of service delivery failure and the risk of losing senior officers to the partner. Nor do we think there is a significant conflict between profitable trading and a public service commitment. We do not think our timescales are risking service delivery but will advocate delaying those timescales if this is judged necessary to protect the Council’s interests and/or to achieve greater contractual benefit…”

Is there a danger the council will use the setting up of the critical friend group to say that it has considered all the risks – even if it has considered then dismissed the most serious of them?

A poor supplier would be in breach of contract – but then what?

To the Panel’s concerns that the joint venture may fail to deliver, or costs escalate, Cornwall responds that if its suppliers do not deliver they will be in breach of contract.

But then what?

Said the council:

“The contract obliges the strategic partner to deliver. Any initial failure to deliver would be dealt with through a service credit arrangement. Persistent failures would represent a breach of contractual conditions which would lead to breach of contract where the Cornwall Partners would exit the contract.

“The cost for this would be picked up by the strategic partner. Financial difficulty is covered by a guarantee that the parent company would step in and continue delivery. Costs are largely within our control…”

Is it straightforward to exit a contract after an alleged breach of contract? The Department of Health was in dispute with CSC over alleged breaches of contract on the National Programme for IT, NPfIT. CSC made it clear in its statements to US regulators that the DH was unable to exit the NPfIT contracts without large payments. CSC and the Department ended up accusing each other of breaches of contract which made negotiations for a settlement long and costly.

Heading for claims of maladministration?

Is Cornwall being naive when it says simply that after any breach of contract the council “would exit the contract”? In the past this has been the legal cycle of events in some major legal disputes on IT contracts

– Customer alleges breach of contract

– Supplier makes counter-claim

– Customer withholds money

– Supplier instigates legal action

– Customer wishes to exit contract but cannot because of potential costs, counter-claims and need for supplier’s cooperation to maintain existing services.

– Long and costly settlement negotiations – which is good for lawyers – while service delivery remains in the “hold” position, unresponsive to changes that may need to be made or remedial action that may need to be taken.

International IT companies are experts in the legal side of contracts and dealing with disputes. Do Cornwall’s ruling councillors believe that the council’s expertise and legal advice would trump the supplier’s in the event of an alleged breach of contract?

When Cornwall says that in a breach of contract it would exit the contract and “the cost for this would be picked up by the strategic partner”, do the council’s ruling councillors trust that the supplier would say to the council in any dispute, “Let us know your costs of exiting the contract and we’ll settle up.”

There is another worrying sign of Cornwall’s apparent naivety. The council says “The costs would only escalate if the Cornwall Partners make changes to the services required.”

Unforeseen change is endemic in the public sector: governments change, policies change, legislation changes, organisations change, particularly the NHS which is a potential party to Cornwall’s outsourcing plans.

Is any public authority that signs up to a large and complex outsourcing deal on the basis of ‘no unforeseen change’ leaving itself open to accusations of maladministration?

Has Cornwall’s democratic process broken down?

The most extraordinary single thing about Cornwall’s outsourcing plans is that, at a full council meeting on 4 September, a majority of councillors voted against a deal but the inner circle is going ahead anyway.

Says the council’s website: “A motion calling on Cornwall Council to change its decision to enter into a partnership with the private sector to deliver a range of support services was supported by a majority of 17 Members following a three hour debate at County Hall on 04 September.”

[The motion was put and seconded by two councillors, Andrew Wallis and Andrew Long, who are not members of the major political parties.]

In dismissing the vote of the council, a spokesman for Cornwall’s pro-outsourcing group said

“All the concerns which have been raised today have already been considered by the Cabinet… This is a very complex proposal and unfortunately the decision by Members not to move into private session meant that we were unable to share the detailed confidential information they needed to make an informed decision”.

Should the Council rush to sign a deal?

Somerset County Council’s joint venture was characterised by a rush to sign, which culminated in the signing at 2am at the weekend. The failed NHS IT plan was also notable among potential suppliers for the haste before the signing of contracts, as was the failed Firecontrol contract. Is Cornwall’s deal being rushed? Cornwall’s Support Services Single Issue Panel said

“The timetable restrictions placed on the SIP [Single Issue Panel] has condensed the available time such that this report has had to be compiled within one working day. Had the timetable slipped by just that one day it is certain that no report would have been submitted.”

The Panel also said

“The risk is that this timescale is far too short for detailed evaluation and due diligence to be carried out. This is a significant value contract. The estimated value of the contract in the Prospectus for Cornwall …was £210m to £800m. The current estimated value is not known to the Panel…”

The council’s inner circle concedes that its timescales are “tight but achievable”.

Conclusion

When outsourcing plans have taken up much time and money there is always a danger a contract will have to be signed to justify the effort.  But would the signing of a mega deal at Cornwall be a triumph of ideology over objective reasoning?

One has to wonder how a mega outsourcing deal can improve services, provide a good profit margin for an international IT company, save the council money and create hundreds of jobs. Doesn’t something have to give? Is there so much inefficiency, and so much money floating around the council and its potential NHS partners, that a major supplier can cut tens of millions of pounds, spend to transform services, and make money?

In evidence to MPs last year SOCITM, which represents ICT professionals in councils, said of outsourcing ICT that it “carries many risks for local authorities and can come at a heavy price”.

Some praise for Cornwall’s approach

Cornwall’s ruling councillors should be applauded for two things:

– There is every sign that the inner circle’s plans are motivated are by the best of intentions: to save money, improve services, protect existing jobs and create more.

– Although some criticise the council’s lack of openness, the inner circle is not hiding all of its papers and discussions in a blanket of secrecy. It has published the report of the “critical friend” Panel and the council’s responses. There is much information – and links – on the planned deal on the council’s website. This doesn’t always happen in the run-up to a large public sector outsourcing contract.

But good intentions do not make up for naivety and a wish for outsourcing that may border on fanaticism – the pursuit of a Cause whatever the dangers.

If a majority of councillors at a full council meeting cannot stop the signing of a mega-deal can anyone?

It appears that a tiny group within the council will make the final decision – although it is arguably the most momentous decision in the council’s history.

Says the council: “The final approval of, and the date for, the issuing of the said invitations to submit final tenders be determined by the Chief Executive in consultation with the Leader of the Council and the Portfolio Holders for Environment, Waste Management Policy and Shared Services, Health and Wellbeing and Human Resources and Corporate Resources.”

The final decision is due next month. If Cornwall enters a deal in which it relies on the contract to protect services and the council’s reputation is it being naive? Could it end up facing accusations of maladministration, particularly after side-lining a council vote against the deal?

**

Thank you to Dave Orr and a journalist in Cornwall for your emails on Cornwall’s outsourcing plans.

Council says its joint venture is failing – BBC

Some papers on Cornwall’s outsourcing plans

Local MP’s website on Southwest One.

An ill-judged outsourcing?

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Posted in BT, BT Health, Campaign4Change, CSC, legal disputes, local government, managing outsourced services, outsourcing, oversight, Politics, private sector lessons for the public sector, public sector, public-private partnerships, risk, supplier relationships

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Well done Eric Pickles – more open government to engulf councils

Posted on 29/08/2012 | 2 comments

By Tony Collins

Few people have noticed but changes to the law next month could force councils to be much more open about big spending decisions including those that involve contracting out IT and other services.

It is a pity though that similar changes will not apply to the NHS.

The Local Government Association says that councils are already more open than Whitehall which is true.

Even so some councils are innately secretive about IT-related spending decisions, and discussions about projects that go wrong. Somerset County Council was notoriously secretive about its Southwest One joint venture with IBM in 2007. The deal has not made the expected savings and has consistently made losses. IBM claims the deal is a success.

Haringey Council’s “Tech refresh” project which went way over budget is another example. Evasive answers to opposition questions and meetings in secret were the norm.

Liverpool City Council was extraordinarily defensive and secretive about progress or otherwise on its Liverpool Direct Ltd joint venture with BT. The deal included giving BT control of IT.

Better public scrutiny

Now Local Government Secretary Eric Pickles has announced that changes to the law will mean that all decisions including those affecting budgets and local services will have to be taken in an open and public forum.

Ministers have put new regulations before Parliament that would come into force next month to extend the rights of people to attend all meetings of a council’s executive, its committees and subcommittees.

Pickles says the changes will result in greater public scrutiny. “The existing media definition will be broadened to cover organisations that provide internet news thereby opening up councils to local online news outlets. Individual councillors will also have stronger rights to scrutinise the actions of their council.

“Any executive decision that would result in the council incurring new spending or savings significantly affecting its budget or where it would affect the communities of two or more council wards will have to be taken in a more transparent way as a result.”

Councils will no longer be able to cite political advice as justification for closing a meeting to the public and press. Any intentional obstruction or refusal to supply certain documents could result in a fine for the individual concerned.

The changes clarify the limited circumstances where meetings can be closed, for example, where it is likely that a public meeting would result in the disclosure of confidential information. Where a meeting is due to be closed to the public, the council must now justify why that meeting is to be closed and give 28 days notice of such decision.

Chris Taggart, of OpenlyLocal.com, which has long championed the need to open council business up to public scrutiny, said

“In a world where hi-definition video cameras are under £100 and hyperlocal bloggers are doing some of the best council reporting in the country, it is crazy that councils are prohibiting members of the public from videoing, tweeting and live-blogging their meetings.”

These are the changes to be made by the  The Local Authorities (Executive Arrangements) (Meetings and Access to Information) (England) Regulations 2012 (the 2012 Regulations) which will come into force on 10 September 2012.

– Local authorities will have to provide reasonable facilities for members of the public to report council proceedings (regulation 4). This will make it easier for new ‘social media’ reporting of council executive meetings, opening proceedings to blogging, tweeting and hyper-local news/forum reporting.

– In the past council executives could hold meetings in private without giving public notice. From 10 September 2010 councils must give 28 days notice where a meeting is to be held in private, during which time people may make representations on why the meeting should be held in public. When the council wants to over-ride the notice period, it must publish a notice as soon as reasonably practicable explaining why the meeting is urgent and cannot be deferred (regulation 5).

– A document explaining the key decision to be made, the matter in respect of which a decision would be made, the documents to be considered before the decision is made, and the procedures for requesting details of those documents, has to be published (regulations 9).

– The new regulations create a presumption that all meetings of the executive, its committees and subcommittees are to be held in public (regulation 3) unless a narrowly-defined legal exception applies.

– Where the council has a document that contains materials relating to a business to be discussed at a public meeting, members of the local authority have additional rights to inspect such a document at least five days before the meeting (regulation 16). Previously no timescale existed.

– Where the council decides not to release the whole or part of a document to a member of an overview and scrutiny committee as requested by a councillor, it must provide a written statement to explain the reasons for not releasing such document (regulation 17).

– Documents relating to a key decision including background papers must be on the relevant local authority’s website (regulations 5, 6, 7, 9, 10, 14, 15, and 21).

Comment

Well done to Eric Pickles and the coalition. These are important and welcome changes. If council decision-makers know their discussions will be open to scrutiny they may give proper consideration to risks as well as the potential benefits of big IT-related investments. With inadequate scrutiny the potential benefits often drive decisions, which was the case with the flawed setting up of Southwest One. The press office at Liverpool City Council was so used to controlling information that its spokesman was outraged at questions we asked about its outsourcing venture with BT.

But what about the NHS?

It’s a pity the NHS is not subject to the new legal changes. Few trusts are open about their big IT-related investments; and when things go wrong, as has happened with some Cerner implementations, NHS trusts tend to lock all the doors, talk in whispers and instruct their press offices to issue statements that claim “teething troubles” have been largely addressed. The trust and everyone reading the statement know it is disingenuous but the facts to prove it are kept under wraps.

Organisations such as Imperial College Healthcare NHS Trust are taking decisions about major IT upgrades that could affect the safety, health and lives of patients without proper scrutiny. Pickles may want to mention his legal innovations to Andrew Lansley.

Eric Pickles announcement on opening up council discussions and decisions 

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Posted in BT Health, Campaign4Change, Cerner, decision-making, e-health, excessive secrecy, health, health records, improving communications, IT-related failures, local government, managing outsourced services, NHS, npfit, openness and transparency, operational issues, outsourcing, Politics, public sector, public services, public-private partnerships, shared services

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Trust buys extras-laden system for 20% of BT’s price

Posted on 30/07/2012 | Leave a comment

By Tony Collins

An NHS Trust has paid £1.8m for the “Rio” patient record system and a host of extras – which raises fresh questions about why the Department of Health paid BT £9m for each Rio deployment under the NPfIT.

BT’s deal with the Department of Health under the NPfIT costs taxpayers £224.3m for 25 deployments of Rio – about £9m for each one. The deal included support for five years, until October 2015.

But a deal struck directly between Cambridgeshire and Peterborough NHS Foundation Trust and Rio’s supplier CSE-Healthcare Systems includes support for a year longer – six years in total. At £1.806m the cost of Cambridgeshire and Peterborough’s deal is about 20% BT’s price.

Cambridgeshire and Peterborough has secured more extras. CSE-Healthcare Systems will supply Cambridgeshire and Peterborough with:

  – Medical software development services

– Software consultancy services

 – Computer support services

– System implementation planning services

– Software implementation services

– Project management consultancy services

– Business and management consultancy services

– Medical software package

– Database and operating software package

– Information systems and servers

– Computer and related services

– Software support services

It’s not clear though whether the deal includes disaster recovery – which the Department of Health argues is one reason for the price paid to BT for Rio.

Comment:

Disaster recovery does not explain how or why the Department of Health agreed to pay BT five times more for Rio than paid by Cambridgeshire and Peterborough.

What is not in doubt is that if BT, like Accenture and Fujitsu before it, had left the NPfIT, the programme would have been indelibly stamped a disaster – at a time when the Department of Health and ministers were proclaiming it an unacknowledged success (in the run up to a general election).

Was BT paid a hugely costly premium to stay in the NPfIT?  If so, should tax money have been used to secure the affections of a supplier whose profits were otherwise being squeezed on the contract?

Last year the Department of Health gave the Public Accounts Committee an explanation of its Rio payments to BT, some of which is below. The explanation is long, vague and defensive enough to sound like the excuses of a young boy who, when questioned by his teacher, gives various accounts of why he took a classmate’s sweets.

What the DH told MPs

This is what the DH told the Public Accounts Committee last year, after one of its MPs Richard Bacon queried the payments to BT for Rio (and Cerner).

“Assessing the value for money of the RiO prices was part of the CCN3 [change control note 3] negotiation process … The CCN3 negotiation process was lengthy and involved many iterations challenging the component parts of the BT cost model. This included ensuring that rates offered were competitive and that the effort ascribed to various activities was justifiable.

Taken together, competitive rates and reasonable effort comprise value for money. BT was required to provide numerous iterations of financial models. These models were reviewed in detail by the Authority, resulting in multi-million pound savings.

The Authority negotiated reduced day rates on all of the BT labour within the contract. In addition, BT’s profit margin on the contract was also significantly reduced. Other commitments were also obtained by the Authority, in particular around sub-contractor pricing; for example, Cerner has confirmed that the pricing provided to the Authority (via BT) is the best it provides to any of its customers.

The Authority then requested further financial assurances and agreed with BT that a requirement of signing CCN3 would be that a verification exercise would be conducted by third party, independent financial experts (KPMG)…

In October 2010 KPMG were requested by the Authority to verify the costs presented by BT, including those for RiO, in the CCN3 Financial Model.

The approach adopted by KPMG was as follows:

—  Their work focussed on the Cost Data sheet within the CCN3 Financial Model and was conducted on a sample basis, designed to provide a high coverage of costs with a reasonable sample size.

—  The cost elements for potential duplicate entries were reviewed.

—  The cost rates associated with BT labour were validated to cost rate cards and payroll records.

—  The hours presented in the Model associated with BT labour were reviewed for reasonableness.

—  Sub-contractor and other supplier costs were validated to the agreements entered into by BT with their suppliers.

—  Cost elements and supporting documentation requested from BT were sampled to substantiate the costs provided…

On 3 November 2010 KPMG concluded that “BT has provided underpinning evidence to support the agreed delivery costs” and that “no proposed adjustments are required for Agreed Delivery Costs”.

None of the trusts consulted had purchased the same RiO product offering and all trusts varied significantly from the offering provided to NPFIT trusts, making a direct price comparison difficult. However, trusts within the programme typically had significant advantages to those outside the programme, namely:

—  The ability to influence the functionality of the product.

—  Centrally provided and hosted hardware.

—  Centrally-provided disaster recovery with 100% capacity and availability.

—  No additional development costs for subsequent releases.

—  Spine connectivity.

BT estimate that the monthly charge for hardware, disaster recovery, service management and Spine connectivity to be in the region of £42,500 per month or just over £2 million of value over a 48 month contract term.

Furthermore the NPFIT investment in the development of the RiO has significantly enhanced the functionality of the product to the benefit of all trusts. Examples of functionality in the latest deployed version (v5) and soon to be deployed (R1, 2011) of RiO include:

—  Standard assessment forms.

—  Care-plans and reports.

—  Spine connectivity, enabling integration with central demographics services, and functionality to support smart cards and role based access controls.

—  Waiting lists.

—  Results reporting.

—  Prevention, screening and surveillance.

—  SNOMED.

—  Inpatient prescribing.

—  Functionality to support multi-disciplinary care planning.

DH statement to MPs on Rio (and Cerner) prices paid to BT

MP seeks inquiry into £546m NHS deal with BT.

Breakdown of £546m NPfIT payment to BT

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